An Epic day in court: Supreme Court rules in favor of Epic, upholds workplace arbitration contracts

In a 5-4 decision led by the conservative justices on the U.S. Supreme Court, Epic came out victorious in a case involving individual employee arbitration decided May 21.

The Epic Systems Corp. v. Lewis case, which was argued in October 2017, consolidated with two others in the Supreme Court — National Labor Relations Board v. Murphy Oil USA and Ernst & Young LLP v. Morris. Writing the majority opinion, Justice Neil Gorsuch sided with the employers.

The case involved Jacob Lewis, a former technical writer at Epic, who alleged the Verona, Wis.-based EHR vendor violated federal and state law by neglecting to pay him and other technical writers overtime pay. However, Epic employees waived the right to participate in any class, collective or representative proceeding when they signed an employment agreement stating wages and working hours could only be discussed through individual arbitration.

Epic and its two co-petitioners argued their individual arbitration contracts do not violate the 1935 National Labor Relations Act and are legal under the Federal Arbitration Act — and the majority of the Supreme Court agreed.

The Court's decision established that companies have a right to resolve labor and wage disputes individually and use arbitration clauses to bar employees from joining together in class action lawsuits against their employer.

In his opinion, Mr. Gorsuch stated the 1925 Federal Arbitration Act predates the NLRA, and therefore, employees who sign arbitration agreements have to do so individually.

"The policy may be debatable but the law is clear: Congress has instructed that arbitration agreements like those before us must be enforced as written," Gorsuch wrote. "While Congress is of course always free to amend this judgment, we see nothing suggesting it did so in the NLRA — much less that it manifested a clear intention to displace the Arbitration Act."

Judge Ruth Bader Ginsburg, however, disagreed. She wrote a dissenting opinion that called on Congress to "urgently … correct the court's elevation of the Arbitration Act over workers' rights to act in concert." She adds the Court's decision will create "huge under-enforcement of federal and state statutes designed to advance the well-being of vulnerable workers."

In a statement to Becker's Hospital Review, Epic Founder and CEO Judy Faulkner said, "It is important that employers protect an employees' right to file complaints, while also providing for a fair forum in which those grievances are addressed. When it comes to grievances regarding wages and hours, we believe individual arbitration agreements strike that reasonable balance and are pleased with the court's decision in support of this."

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